Answering Consolidation questions

[Ulysses Kwaku Nubueke]

What is the effective way of answering consolidation exam questions. Where do we start from. Do we start from the adjustments or where?
Thanks.

[Vandana]

we have a step by step method that we use in the GTG material. It basically involves the following:

1) set up your proforma consolidated financial statements
2) set up workings for a) Consolidated retained earnings b) goodwill c) minority interest
3) work through the question, adjustment by adjustment, and add a working for each one
4) add/ subtract the adjustments on the balance sheet, or in a working
5) finally prepare your consolidated balance sheet
I hope this helps - more details in the GTG study text for F7.

[Sao]

Hi

consolidated accounts is probably the toughest topic of f7...and probably the most important as well because the 1st question always comes from consolidated accounts which is worth 25 marks.

i gave the f7 paper in the dec 07 session...

i had the greatest difficulty in consolidated accounts but i was able to manage them just about 3 or 4 days before the exam...

the main thing is PRACTICE.....again and again...i personally did the same consolidation questions from the kit thrice or even upto 4 or 5 times...i used FTC study text as well as kit.

what Vandanna has said is ryte...u shud approach it systematically and step by step and make sure you dont miss anything in the notes (ie adjustments).

first thing is to calculate the goodwill. it carries a lot of marks and is the first step to getting the question correct...then carry on with the reserves and minority interest.

hope this helps

Sao~